Just one day after his company reported third quarter earnings, Vikram Pandit is unexpectedly out as Citigroup’s CEO. Pandit and the board don’t agree on why. Pandit claims that resigning was his decision and that he “been thinking about this for a long time”. The board sees things differently. It reportedly ousted Pandit due to Citi’s subpar financial performance and his “poor execution”.

Pandit is being replaced, effective immediately, by Michael Corbat, the man who until yesterday was responsible for Citi’s business in Europe, the Middle East, and Africa. As recently as August, such a change seemed unlikely. Pandit “told colleagues that he intends to stay [on as CEO] for several years”, according to Suzanne Kapner at the WSJ. Even then, however, there was increasing pressure from the board of directors to outline succession plans and groom his potential replacements.

Citi’s stock is down 90% since Pandit took over as CEO in late 2007, and has lagged all its rivals. More broadly, as the FT’s Tracy Alloway points out, Citi’s share price over Pandit’s tenure is worse than every other financial company in the S&P 500, save AIG. And beyond financial failings, Pandit also had the issue of “regulatory baggage” that he could never seem to shake.

In the past few months, there have been even more setbacks. In April, Citi failed the Fed’s stress test and had its $8 billion share buyback program rejected. In September, the bank was forced to take a $3 billion loss on the sale of its Smith Barney stake to Morgan Stanley. Citi also failed to spot on the surge in housing that drove JP Morgan and Well Fargo’s results. That lead to yesterday’s earnings, which Matt Levine characterized described as an “excellent 88% decrease in profit”.

Pandit worked for $1 in 2009 and 2010, but was awarded a $15 million pay package for 2011. Shareholders, in a move Credit Agricole’s Mike Mayo called a “milestone for corporate America… a wake-up call”, rejected it. That vote, however, was non-binding and Pandit’s pay package was essentially unaltered. In total, Pandit made $261 million while at Citi, including the $165 million he was paid when Citi bought out his hedge fund in 2007 to bring him on as CEO. In 2008, Citi shut down the fund and took a $200 million loss on its acquisition. Now, it appears Pandit isn’t in line to receive any severance pay, but he might get to use the corporate jet at a discounted rate.

It’s unlikely that the board and Pandit will ever get on the same page about who dumped whom. Regardless, both Felix and Dealbook’s Steven Davidoff think Pandit’s removal is a sign that Citi’s board, led by chairman Michael O’Neill, has found its spine. Now it’s up to Corbat to show, in the wake of large missteps by Sandy Weil, Chuck Prince, and Pandit, that Citigroup can too be managed. — Ben Walsh